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Ratification of Timor Sea treaty by Australia

Santos Limited today welcomed the ratification of the Timor Sea Treaty by the Australian Parliament. This is a further milestone in the future development of the liquefied natural gas (LNG) stage of the Bayu-Undan project.

The Bayu-Undan gas and liquids field is located in the Timor Sea, 500 kilometres north west of Darwin. Santos, with an 11.8% interest, is the only Australian company involved in the field.

An LNG development would represent the second stage of the project. The first stage, costing US$1.8 billion and involving production of natural gas liquids (LPG and condensate) is already at an advanced stage, with first production planned for April 2004.

Total revenue from the full development of Bayu-Undan is estimated to exceed $A30 billion.

The passage of this legislation is an important step towards the commercialisation of Bayu-Undan gas reserves, to the benefit of both East Timor and Australia, said Santos Managing Director, Mr. John Ellice-Flint.

Following the project ramp-up, LNG production net to Santos would be over 3 million barrels of oil equivalent (mmboe) per annum. Approximately 50 mmboe of probable gas reserves would be moved to proven reserves.

We look forward to working with all stakeholders to bring this important project to fruition, he said.

Current interests in the Bayu-Undan project are:

ConocoPhillips 64.14% (Operator)
Santos Group 11.83%
AGIP 12.32%
Inpex 11.71%